Bitcoin is approaching a critical technical and psychological level as a deepening market selloff pushes the world’s largest cryptocurrency below $95,000 for the first time in nearly six months. The drop comes amid a broad wave of risk aversion and nearly $900 million in outflows from Bitcoin investment funds.
Bitcoin slid as much as 4.7% to $94,147, narrowing the gap with its year-end 2024 close of $93,714. The token reached a record high of $126,251 in early October, but the ongoing correction has nearly erased all gains accumulated this year.
Options Market Turns Bearish as Traders Hedge Against Further Declines
In the past 24 hours, the demand for downside protection has surged.
Data from Deribit (via Coinbase) shows:
- Puts at $85,000 and $90,000 now dominate open interest
- Previously popular bullish calls at $120,000 and $140,000 have been overtaken
- Call options above $100,000, which dominated much of the year, have dropped sharply
This shift signals growing expectations of continued volatility and potential deeper losses.
Crypto Market Still Staggering After October’s Massive Liquidations
The broader crypto market has not fully recovered from the $19 billion liquidation shock on October 10, which erased over $1 trillion in total market value (CoinGecko data).
Additional pressure points:
- Long-position liquidations have risen all week
- Open interest in crypto futures remains depressed
- The Crypto Fear & Greed Index is approaching “extreme fear”, indicating worsening sentiment
Bitcoin ETFs also recorded $870 million in net outflows on Thursday, the second-largest daily withdrawal since their launch.
Macro Pressure: Fading Equity Rebound and Fed Uncertainty
A short-lived rebound in U.S. equities earlier this week—sparked by relief over the government shutdown’s end—quickly faded.
With key economic data releases delayed, traders now doubt whether the Federal Reserve can justify near-term rate cuts.
This reassessment is putting added pressure on all risk assets, including cryptocurrencies.
“Crypto’s beta to macro risks will stay high until deeper institutional participation broadens beyond Bitcoin and Ether,”
—Max Gokhman, Franklin Templeton Investment Solutions
Liquidity Thins: Market Depth Drops 30% From Yearly High
Crypto liquidity has deteriorated sharply.
Kaiko reports that market depth—the ability to absorb large trades without major price disruption—has fallen approximately 30% from this year’s peak.
According to Augustine Fan of SignalPlus:
“Bitcoin is now negative since President Trump’s inauguration, and with overall crypto market cap back to year-to-date levels, there’s little technical support until the low $90,000s.”
Options Traders Brace for Big Moves: Strangles and Straddles Rise
Nick Ruck of LVRG Research notes a rise in demand for neutral volatility strategies such as:
- Strangles
- Straddles
Traders are increasingly pricing in large directional moves—without committing to a bullish or bearish bias.
Strategy Inc. Stock Slide Raises Enterprise Value Concerns
Shares of Strategy Inc., the major Bitcoin-accumulating company, fell about 4% on Friday and are now down over 30% year-to-date.
The company’s enterprise value is at risk of slipping below the value of its roughly $60 billion Bitcoin holdings.
As of Thursday:
- Enterprise value: ~$74.8 billion
- High exposure to Bitcoin price movements is amplifying investor concerns
During a CNBC interview Friday morning, Michael Saylor said Strategy is purchasing “quite a lot” of Bitcoin and will disclose its new holdings on Monday. He added that prices should “rally from here.”
Saylor also posted a single word on X: “hodl.”
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